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2026 Supreme(Del) 929
IN THE HIGH COURT OF DELHI AT NEW DELHI
HARISH VAIDYANATHAN SHANKAR, J.
M/s Shanti Developers - Petitioner
Versus
Virender Singh - Respondent
O.M.P.(I) (COMM.) 198 of 2026, I.A. 12713 of 2026 (EX.)
Decided On : 11-05-2026
Important Points
Subject
Arbitration Law - Interim Measures and Arbitrability
Act Referred
Headnote
Facts of the case:
The parties executed a prior agreement regarding the specific portion of a property containing an arbitration clause. Subsequently, the parties entered into a separate memorandum of understanding governing a different portion of the property and additional financial liabilities. The petitioner attempted to invoke the arbitration clause from the first agreement to seek interim measures for a dispute arising from the later memorandum.
Findings of Court:
The court concluded that the later memorandum was an independent commercial arrangement. It noted an utter absence of any express reference or intent to adopt the dispute resolution mechanism of the first agreement into the latter, thereby failing to satisfy the mandatory requirements for incorporation by reference.
Issues: Whether the arbitration clause contained in a prior contract is applicable to disputes arising from a subsequent and distinct memorandum of understanding that lacks an independent arbitration clause.
Ratio Decidendi: An arbitration agreement is not automatically extended to subsequent agreements through mere factual connection. To be validly incorporated by reference under statutory law, there must be a clear and conscious intention reflected in the document to adopt the specific dispute resolution clause of the prior document into the new contract.
Result: Petition dismissed as not maintainable.
For the Petitioner:Mr. Anshul Mittal, Mr. Sameer Dawar, Mr. Sparsh Agarwal and Mr. Vaibhav Garg, Advocates.
For the Respondent:Mr. Abhijat, Senior Advocate along with Mr. Sumit Chander, Mr. Gurdeep Chauhan, Ms. Barnali Basak, Ms. Selva Kumari and Mr. Adarsh Pratap Singh, Advocates.
| Table of Content |
|---|
| 1. background and factual matrix concerning spa and subsequent mou. (Para 1 , 2 , 3 , 4 , 5 , 6) |
| 2. parties' contradictory arguments on arbitration clause applicability to the mou. (Para 7 , 10 , 11 , 12 , 13 , 14) |
| 3. analysis of existence of independent agreements and lack of arbitration incorporation. (Para 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23) |
| 4. legal standard for incorporation of arbitration clauses via reference under section 7(5). (Para 24 , 25 , 26 , 27 , 28) |
| 5. dismissal of petition due to lack of maintainability and arbitration agreement. (Para 29 , 30 , 31 , 32 , 33 , 34) |
JUDGMENT :
HARISH VAIDYANATHAN SHANKAR, J.
1. The present Petition, filed under Section 9 of the Arbitration and Conciliation Act, 1996, Act, seeks certain ad interim measures against the Respondent. The reliefs sought for, by way of the present Petition, are as follows:
“A. Restrain the Respondent and/or his Representatives, Attorneys, Assignees, etc. from creating, either directly or indirectly, any third party interest in respect of the Ground Floor of the property situate at E-96, Saket, New Delhi;
B. Restrain the Respondent and/or his Representatives, Attorneys, Assignees, etc. from handing over the possession of the Ground Floor of the property situate at E-96, Saket, New Delhi to any third party;
C. In case the property is already rented out, the Respondent be directed to provide the relevant details including the amount already received by him towards the rent so far for the Ground Floor of property bearing No. E-96, Saket, New Delhi;
D. Direct the Respondent to deposit the amount already received as well as the future rent to be received in respect of Ground Floor of property bearing No. E-96, Saket, New Delhi before this Hon'ble Court;
E. Pass ex-parte ad-interim orders in terms of the prayers mentioned above in favour of the petitioner; and
F. Pass such other and further order (s) as may be deemed appropriate by this Hon'ble Court in the interest of justice.”
2. Learned counsel appearing on behalf of the Petitioner, at the outset, submits that the disputes inter se the parties arise out of the Special Power of Attorney dated 09.11.2021SPA executed between the parties in relation to the property bearing No. E-96, Saket, New Delhi. Subject Property
3. Learned counsel submits that the aforesaid SPA governed the rights and obligations of the parties in relation to the first floor of the Subject Property and, inter alia, Clause 11 thereof dealt with the receipt and disbursal of the sale consideration arising therefrom. It is further submitted that Clause 19 of the SPA contains an arbitration agreement between the parties, which reads as under:
“19. In case of any dispute/discrepancies will be sorted out by appointing an arbitrator with mutual consent.”
4. Learned counsel appearing on behalf of the Petitioner submits that disputes have arisen between the parties on account of the alleged non-payment and non-disbursal of the agreed sale consideration receivable by the Petitioner pursuant to the transaction contemplated under the SPA.
5. Learned counsel contends that despite the Petitioner having rights in respect of the first floor of the Subject Property under the Collaboration Agreement dated 20.10.2021CA between the parties, the Respondent proceeded to deal with and sell the same and thereafter failed to honour the financial obligations allegedly owed to the Petitioner.
6. Learned counsel submits that the subsequent Memorandum of Understanding dated 05.03.2024 MoU executed between the parties was merely an arrangement intended to secure and regulate repayment and liability arising from the SPA. It was, in essence, an extension and continuation of the arrangement embodied in the SPA.
7. Learned counsel for the Petitioner, in the backdrop of the foregoing submission, submits that the MoU cannot be treated as extinguishing the arbitration agreement contained in the SPA and therefore the present disputes are arbitrable, warranting interim pr
